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Lucapa Revenue Soars in Fourth Quarter

Jan 31, 2022 7:13 AM   By Rapaport News
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Lucapa Diamond Company’s revenue surged in the fourth quarter amid the restart of sales from its Mothae mine and a spike in rough prices at its high-value Lulo deposit.

The company’s revenue from operations jumped 393% year on year to $13 million for the three months that ended December 31, the miner said last week. Lucapa owns 39% of the Lulo mine in Angola, and 70% of Mothae, in Lesotho.

During the same period in 2020, the company did not garner any revenue from Mothae, while it negotiated a partnership agreement with manufacturer Safdico for the purchase of rough from that site. Lucapa also held only one sale of goods from Lulo during the fourth quarter of 2020, compared with its usual two.

Sales from Lulo — on a 100% basis — skyrocketed 294% year on year to $26.1 million for the October-to-December period. Sales volume from the deposit climbed 91% to 8,158 carats, with a 106% rise in the average price to $3,196 per carat.

The price increase outweighed a 39% drop in output from Lulo to 3,946 carats amid a move to lower-grade ore during the rainy season, Lucapa noted. During the three months, Lucapa recovered 149 stones weighing more than 4.8 carats from Lulo, a 50% decrease over the same period in 2020. Those included 34 special-size stones — above 10.8 carats.

Total revenue from Mothae came to $3.7 million from the sale of 8,207 carats at an average price of $456 per carat. All of the goods were sold into Lucapa’s sales agreement with Safdico, for which it receives a portion of the polished proceeds.

Production from the deposit rose 22% to 8,033 carats, with 201 of the stones recovered weighing more than 4.8 carats, 21% higher than the same period the year before. Some 40 of those were special size.

For the full year, Lucapa sold a total of 27,817 carats from Lulo for $78.1 million at an average price of $2,808 per carat, and had 1,100 carats in inventory at the end of the quarter. The miner sold 36,154 carats from Mothae for $24.9 million at an average price of $688 per carat. It held 3,325 carats in stockpiles at that deposit. Overall revenue increased 246% to $48.7 million.

Image: Rough from the Lulo mine. (Lucapa Diamond Company)
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Tags: Angola, diamonds, Lesotho, lucapa, Lucapa Diamond Company, Lulo, Lulo mine, Mothae, Mothae Mine, Rapaport News, Rough Diamonds, Safdico
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